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A Tale of Two Purple States

By GROVER G. NORQUIST and PATRICK GLEASON

November 24, 2013

Republican and Democratic strategists are anxiously awaiting the final results of the excruciatingly close Virginia attorney general’s race, where votes are still being counted. Republicans are already dejected about losing the governor’s mansion in Richmond, and giving up the AG spot would mean that every statewide office in Virginia is now held by a Democrat for the first time in four decades. But the GOP should take heart and learn an important lesson heading into 2014 by comparing its failure in the Old Dominion to what has transpired in neighboring North Carolina, another battleground state that, politically, shares Virginia’s reddish-purple hue.

The Virginia GOP’s problems are largely of its own making. Outgoing Virginia Gov. Bob McDonnell tarnished the Republican brand in his state and destroyed the party’s advantage on the tax issue earlier this year when he put his signature on a bill that raised taxes by $5.9 billion. Terry McAuliffe, his successor, made his support for McDonnell’s tax hike a key component of his message. Let’s just say that if you are a Republican and Terry McAuliffe is running on your tax plan, it’s a safe bet that it was probably a bad idea. Not only was McDonnell’s tax package dumb politics—a Roanoke College poll on the proposal found 49 percent opposed and only 33 percent supportive—it was terrible policy to boot.

Republicans in North Carolina went in the opposite direction, passing a historic tax reform package that included the largest income tax rate reduction in the country in 2013. The legislation dropped the top personal income tax rate by 25 percent, taking it from 7.75 percent, previously the highest rate in the Southeast, to 5.75 percent and flattening what had been a progressive income tax system. The Tar Heel State’s tax reform also reduced the corporate tax rate from 6.9 percent to 5 percent (eventually down to 3 percent, if revenue targets are met) and eliminated North Carolina’s death tax, making Pinehurst and the Outer Banks even more attractive to retirees from around the country.

According to a poll released by Americans for Prosperity earlier this month, 60 percent of North Carolina voters approve of the corporate tax rate reduction, and 70 percent approve of the lowering and flattening of the state personal income tax. It appears that the North Carolina tax reform package wasn’t just excellent policy, it was good politics—a reverse McDonnell, if you will. So not only is North Carolina’s BBQ superior to Virginia’s, so are its Republican politicians.

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Meanwhile, back in the Commonwealth, when McDonnell wasn’t raising taxes, he was grabbing headlines for vaginal wand mandates and receiving perhaps legal, but shady gifts from financial backers.

In 2010, Republicans took over the North Carolina Legislature for the first time in more than a century. Since then, the New York Times editorial board and other left-wing critics have tried to paint them as a bunch of troglodytes turning the state into a backwater. Despite sneers from Manhattan, it is clear that North Carolina voters are satisfied with how Republicans have turned the state around after more than a decade of high tax-and-spend policies under Democrats.

After spending their first two years in power blocking Democratic Gov. Bev Perdue from imposing a second round of tax hikes in addition to the $3 billion in higher taxes she signed into law shortly after taking office in 2009, North Carolina voters issued a vote of confidence in Republicans by increasing their legislative majorities in 2012, a year in which President Barack Obama was on the ballot, the Democratic National Convention was held in Charlotte and the party’s turnout machine was in full force. Amid a bad year for the GOP nationally, Republicans in North Carolina walked away from 2012 with control of the governorship and supermajorities in both chambers of the state legislature.

If North Carolina Speaker Thom Tillis, now a candidate for U.S. Senate, wins the Republican nomination to run against Sen. Kay Hagan (D-N.C.) next year, it will make for quite the contrast. His signature legislative achievement, the aforementioned tax reform, is very popular among North Carolina voters, while Hagan’s most prominent Senate vote, the one she cast for Obamacare, is extremely unpopular back home.

Republicans trying to learn lessons from the 2013 elections and past mistakes would be wise to take a long look at the difference in how Republicans have behaved in Virginia and North Carolina in recent years, then examine the contrast in the electoral outcomes that followed.

Grover Norquist is president of Americans for Tax Reform. Patrick Gleason is ATR’s director of state affairs.